Tank Car Update Presentation to SWARS Paul F. Titterton, CFA Vice President and Group Executive Fleet Management, Marketing, & Government Affairs

February 28, 2013

Unless otherwise noted, GATX is the source for data provided

NYSE:GMT Forward-Looking Statements This document contains statements that may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor provisions of those sections and the Private Securities Litigation Reform Act of 1995. Some of these statements may be identified by words like “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “predict,” “project” or other similar words. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including those described in GATX’s Annual Report on Form 10-K for the year ended December 31, 2012 and other filings with the SEC, and that actual results or developments may differ materially from those in the forward-looking statements. Specific factors that might cause actual results to differ from expectations include, but are not limited to, (1) general economic, market, regulatory and political conditions affecting the rail, marine and other industries served by GATX and its customers; (2) competitive factors in GATX’s primary markets, including lease pricing and asset availability; (3) lease rates, utilization levels and operating costs in GATX’s primary operating segments; (4) conditions in the capital markets or changes in GATX’s credit ratings and financing costs; (5) risks related to GATX’s international operations and expansion into new geographic markets; (6) risks related to compliance with, or changes to, laws, rules and regulations applicable to GATX and its rail, marine and other assets; (7) operational disruption and costs associated with compliance maintenance programs and other maintenance initiatives; (8) operational and financial risks associated with long-term railcar purchase commitments; (9) changes in loss provision levels within GATX’s portfolio; (10) conditions affecting certain assets, customers or regions where GATX has a large investment; (11) impaired asset charges that may result from changing market conditions or portfolio management decisions implemented by GATX; (12) opportunities for remarketing income; (13) labor relations with unions representing GATX employees; and (14) the outcome of pending or threatened litigation. Given these risks and uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis, judgment, belief or expectation only as of the date hereof. GATX has based these forward-looking statements on information currently available and disclaims any intention or obligation to update or revise these forward-looking statements to reflect subsequent events or circumstances.

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Agenda • Tank Car Market Overview • Crude Oil Focus

o Crude characteristics as they relate to car demand and specification

o Regulatory Issues • Design history • Crashworthiness of flammable liquids tank cars • H2S

• Risk Focus for Tank Car Buyers o Car Selection o Compliance o Market Risk

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Tank Car Market Overview Fleet Trends Since 2008

Current Production Backlogs

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A surprisingly steady fleet…

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000North American Tank Car Fleet

SpecialtyAcidHigh-PressureGeneral-Service

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…masks the beginning of an important evolution.

0%2%4%6%8%

10%12%14%16%18%20%

Tank Cars by GRL

GSAcidSpecialty

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Increasing regulatory complexity favors full-service leasing…

77% 78% 79% 79% 80% 81%

23% 22% 21% 21% 20% 19%

0%10%20%30%40%50%60%70%80%90%

Tank Car Ownership Share

LessorShipper

7

82.93%

17.07%

Tank Car Ownership 1/1/13

Top 10All Other

8

82.56%

17.44%

Tank Car Ownership 1/1/08

Top 10All Other

…and favors scale among tank car owners.

Crude Oil Taking Increasing Share of Production Figures in Thousands

Pre-Recession (1/1/08)

Pre-Crude Boom (1/1/10)

One Year Ago (1/1/12) Today (1/1/13)

Large NC/NI 263K 45.7 53.4 54.2 56.0

Large NC/NI 286K DOT111A100 1.3 1.2 1.7 7.3

Large EC/I 286K DOT111A100 0.3 0.2 0.2 0.5

Medium EC/I 263K 23.2 26.0 27.1 27.8

Medium EC/I 286K DOT111A100 0.4 0.2 0.2 1.5

Total 70.8 81.0 83.5 93.1

9 Source: UMLER, ARCI

~9.6K of ~17.7K tank cars produced in 2012 were crude-capable.

Tank Car Production Backlogs Crude Car Supply and Demand • 80% of current railcar backlogs are tank cars (48.2K out

of 60.2K) • Tank car backlog equals 19.3% of total tank car fleet • Estimated 2013 production of 19K-24K is 2.4x to 3.1x

natural tank car replacement rate • Crude-capable fleet up 22.3K since 1/1/08

o If non-crude tank car demand is down roughly 10%, this suggests the crude fleet is at roughly 30K cars.

o This would imply a current crude-by-rail capability in North America of roughly 1 to 1.5 MMbbl/d depending upon turn times, car types, and crude types

10 Source: ARCI, FTR, EPA, AAR

Crude Oil Focus Crude Types

Car Specification Fleet Requirements

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North American Crude Production and Distribution • U.S.

o Production growth continues in Bakken, Permian, and Eagle Ford formations; others to follow

o Growth projected from 6.7 MMb/d in 2012 to 11.6 MMb/d in 2022 • Canada

o Expected to provide more than 80% of U.S. crude imports by 2022

o Growth projected from 3.5 MMb/d in 2011 to 5.6 MMb/d in 2025 • Rail is critical to accommodate this new growth, at least

in the near term o If even half of this incremental 7MMb/d goes by rail, there will be

a need for at least 70,000 railcars to move it o Pipeline infrastructure is not in place yet; future pipeline

development is an open question

12 Sources: BENTEK, GATX

Lighter U. S. Crudes (Bakken, Eagle Ford, Permian)

• 6.2 to 7.0 LB/Gal • <5 cSt viscosity at moderate temperature • <0.5% sulfur • Origin: North Dakota, Montana, Texas • Destinations: Coastal US and Eastern Canadian

refineries • Turn times: 14-20 days • Optimal Car: 31,800-gallon 286K NCNI tank • Fleet requirement: 19-28 railcars per 1,000bbl/d

13 Sources: BENTEK, ND DMR, Crude Quality, Inc., GATX

Canadian Crudes

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• 7.2 (synthetic) to 7.8 (dilbit) to 8.4 (unprocessed) LB/Gal • 5-15 (synthetic) to 130-220 (dilbit) to >250

(unprocessed) cSt viscosity at moderate temperature • >1% sulfur • Origin: Alberta • Current Destinations: US Gulf Coast • Future Destinations: US MW, Pacific export • Turn times: 10-20 days • Optimal Cars:

o Dilbit: 25.5 or 28.3Kgal 286K EC/I tank o Synthetic: 28.3 or 29.2Kgal 286K EC/I tank

• H2S issue under study • Fleet requirement: 15-32 railcars per 1,000bbl/d

Sources: BENTEK, ND DMR, Crude Quality, Inc., GATX

Tank Car Regulations Design History

Crashworthiness of Flammable Liquids Tank Cars Hydrogen Sulfide

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Evolution of Crude Oil Tank Car Specifications

• Factors affecting crude oil tank car configurations and capacity

o Density drives car capacity o Viscosity affects flow and need for

heater coils & insulation

o Sulfur content will affect need for lining and stainless fittings

o Water content could cause corrosion

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Evolution of Crude Oil Tank Car Specifications

• Tank car specs 1970 – 1995 o Capacity limited to 25K gallons o Shell Material A-515-70 Steel o 263K GRL o Interior heater phased to exterior coils o Visual outage gage scale

• Tank car specs 1996 – 2010

o Higher grade steel o Improved crashworthiness o Million Mile underframes applied o Electronic gage device o Still 263K GRL

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Current State of Crude Oil Tank Specifications

• AAR issues Circular letter CPC-1232 for crude oil and ethanol service

o 286K GRL takes precedence o Larger Volume Capacity o Affects cars ordered after October 10, 2011 o Half-Height Head shield protection o Tank & Head Material must be

normalized TC-128 Gr. B or A-516-70 o 1/2” shell thickness for TC128 non-jacketed cars

(5/8” for A-516-70) o Top fitting protection required o PRD must be reclosing type

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Current Crude Oil Tank Car Specifications

• Single cars - capacity 29K & 31.8K gallons at 286L GRL

o 29.2K car with insulation & heater coils for all climates

o 31.8K car is multipurpose for crude, gasoline or ethanol • Un-insulated & no coils allows more shipping capacity • Product payload dependent on product density • Optimal for use in moderate climates

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• Derailments of ethanol unit trains cause extensive damage, clean-up costs, fatality

• DOT not satisfied with AAR responsive actions to date

Arcadia, Ohio

New Brighton, Pa

Rockford, IL

Future Crude Oil Tank Car Specifications

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Future Crude Oil Tank Car Specifications

• Regulatory Activity o Shippers / FRA feel CPC-1232 oversteps AAR authority o DOT / PHMSA accept AAR petition to adopt CPC-1232 specification o DOT / PHMSA asks industry for more than CPC-1232, including

consideration of thermal protection o NTSB exerting pressure on DOT to address BOTH new and existing fleet

• Industry Advocacy (AAR, Private Car Owners, Shippers) o Continued support of CPC-1232 recommendations o Alternate pressure relief device for thermal protection o Modifications to bottom outlet valves

• Status o DOT / PHMSA has submitted to OST / OMB o ANPRM expected any day o Final rule making at least 2 years out

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• Thermal Protection Systems • Option 1 – Modified PRD Design

o Goal – Fully exhaust tank contents at low pressure to prevent explosion

o Most practical and economical for both new and existing fleet

o Challenge – new valve designs required

o Likely that DOT would adopt

• Option 2 –Fire rated Insulation Blanket o Goal – Control tank temperature during

fire conditions o Practical for new, NOT for existing o Challenge – Reduced tank capacity, no

reliable retrofit options

Future Crude Oil Tank Car Specifications

Modified PRD Designs

Fire Rated Insulation 22

• Enhanced Bottom Outlet Valve Protection

o Goal – Eliminate potential BOV “catch points” during derailments

o AAR tank car committee has proposed a rule that includes:

• No handles in transit, or stow handles in transit

• Visual indication of open/ closed position

o Both new car and retrofit of existing fleet is likely

Future Crude Oil Tank Car Specifications

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• Improved Crash Worthiness • Better / Thicker Tank Steel

o New steels under review, but current steel is tough to beat

o Retrofit of existing fleet impossible, but obsolescence risk offset by other more effective options

o DOT likely to incorporate AAR requirements into final rule for crude oil service

• Head Protection o Practical retrofit option based on past

precedence o Most efficient crash worthiness option o DOT likely to incorporate AAR

requirements into final rule for crude oil service

Future Crude Oil Tank Car Specifications

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• Enhanced Train Control o DOT wants to stop trains faster at the first sign

of an accident o Electronically Controlled Pneumatic (ECP) and

Distributed Power (DP) under consideration o Both options are very effective in normal

operation, questionable in emergency situation o Implementation costly and complex for mixed

freight service o DOT will NOT likely incorporate into final rule

Future Crude Oil Tank Car Specifications

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Hydrogen Sulfide • Transport Canada concerned about H2S building up in

the vapor space of cars carrying sour crude • Issue under study • Industry view has generally been that volume, pressure,

and concentration make hazard level low • Some concern about possible corrosive effect on tank

shell and fittings

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Risk Focus for Tank Car Buyers

Crude Car Selection Regulatory Compliance

Market Risk

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NC/NI vs. EC/I • NC/NI cars are the lightest-weight, highest-capacity cars

for light crude shippers • 2.6KGal/load (62bbl) is a major advantage

o Savings can be $100s/carload • However

o NC/NI cars can’t move heavy crude o NC/NI cars may be more likely to attract new rules o NC/NI cars have seen a greater run-up in fleet size due to the

sequential booms in ethanol and crude

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Tank Car Regulatory Compliance and Market Risks • HM216 places expanded burdens on car owners for

developing and overseeing compliance processes • New car owners face daunting “build it or buy it” choice

on compliance capability o Scale increasingly important to efficient and effective compliance

practices o Access to shop capacity may become extremely valuable

• Market risks remain o Overbuilding o Pipelines o External risks (environmental, economic, political)

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Questions? Paul F. Titterton, CFA Vice President and Group Executive Fleet Management, Marketing, and Government Affairs GATX Corporation paul.titterton@gatx.com

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